Who carries the risk when cargo gets wet?
On almost every ocean shipment, the party who packs the container is not the party who carries the transit risk. Understanding this gap — and closing it with the right desiccant strategy — keeps goods, margins and business relationships dry.
The risk changes hands at the ship's rail
International sales contracts allocate transport risk via Incoterms. Under the most common sea freight terms — FOB, CFR and CIF — the risk of loss or damage passes from the seller to the buyer the moment the goods are loaded on board at the port of origin. The exporter packs and seals the container; from the ship's rail onwards, the importer owns every temperature swing, every monsoon front and every drop of condensation.
| Incoterm | Who packs the container | Who carries the transit risk |
|---|---|---|
| EXW | Seller (exporter) | Buyer — from the seller's premises |
| FOB / CFR / CIF | Seller (exporter) | Buyer — from loading on board |
| DAP / DDP | Seller (exporter) | Seller — until delivery at destination |
The insurance gap
Many buyers assume cargo insurance will pick up the bill. Often it will not. CIF only obliges the seller to arrange minimum cover (Institute Cargo Clauses C) — which does not cover moisture damage at all. And even all-risk policies (ICC A) contain exclusion 4.3: loss caused by "insufficiency or unsuitability of packing or preparation" is excluded. Missing or under-dimensioned desiccants are a textbook case — insurers regularly decline condensation claims on precisely this basis.
The result: the importer carries the risk, frequently cannot recover the loss from insurance, and never saw the container being packed. The exporter packed the box but — depending on the term — feels little of the damage. That is why moisture protection belongs in the sales contract, not in the fine print.
- estimated annual damage caused by container rain worldwide
- $6–8 bn
- shipments suffers condensation damage at sea
- 1 in 5
- fewer moisture claims with correctly dimensioned desiccants
- 85–95 %
Insurance is no substitute for packing
ICC (C) minimum cover does not include moisture at all, and exclusion 4.3 lets insurers decline condensation claims whenever packing or preparation was inadequate. The only reliable protection is preventing condensation in the first place.
Two roles, two levers
What does this mean for your role?
For exporters & shippers
You pack the container. Deliver dry, avoid claims and recourse — and turn documented moisture protection into a selling point.
Learn more
For importers & buyers
You carry the risk from the ship's rail. Specify desiccant type, quantity and proof in your purchase contract — before the box is sealed.
Learn moreMake transport risk a solved problem
We dimension the moisture protection for your routes, cargo and season — with products proven in over 20 years of container logistics.
FAQ
Frequently asked questions about transport risk
Who is liable for moisture damage during sea freight?
It depends on the Incoterm. Under FOB, CFR and CIF the buyer carries the transit risk from the moment the goods are loaded on board; under DAP or DDP the seller carries it until delivery at destination. Regardless of the term, liability can fall back on the exporter if the packing was demonstrably inadequate.
Does cargo insurance cover container rain?
Often not. The CIF minimum cover (Institute Cargo Clauses C) excludes moisture damage entirely, and even all-risk policies (ICC A) exclude losses caused by insufficient packing or preparation (exclusion 4.3) — missing or under-dimensioned desiccants are a typical example.
How can importers and buyers protect themselves?
Specify moisture protection in the purchase contract: desiccant type (calcium chloride based for ocean freight), quantity per container, placement along the full container length and photo documentation before sealing — or supply the desiccants to your supplier yourself.
How big is the problem of container rain?
Industry estimates put condensation damage at 6–8 billion US dollars per year across global supply chains; roughly one in five shipments is affected. Correctly dimensioned desiccants reduce moisture claims by 85–95 percent.